Employers are adding AI adoption to the list of reasons they will switch insurance brokers, according to Zywave's 2026 Broker Services Survey. The annual study found that failing to use modern technology and AI tools entered the top eight reasons for broker churn for the first time. At the same time, the share of employers who expect their broker to act as a trusted strategic advisor climbed to 71%, up from 56% in 2023.
While clients demand deeper strategic advice, they want less frequent manual contact. Desired weekly touchpoints with a broker fell to 33.4% from 41.9% the year before, as self-service portals absorb routine tasks. Martin Simoncic, CEO of Zywave, said the data shows employers want both efficiency and guidance. "AI is no longer optional infrastructure for brokers, it's becoming a visible part of how clients judge value," he said. "Employers aren't asking brokers to choose between technology and advice. They want both."
Technology gaps now a stated reason for client churn
Slow response times, inconsistent communication, and a lack of strategic advice remain the top three reasons employers consider switching brokers. This year, failing to adopt modern technology and AI tools broke into the top eight-a signal that clients now view digital sophistication as a baseline service expectation, not a differentiator for large firms alone.
Brokers lag in AI readiness, independent data shows
Independent research from the Big "I" Agents Council for Technology reveals a gap between client expectations and agency reality. While two-thirds of independent agencies plan to increase AI use in the next year, only 8% use it in daily workflows, and 55% have no written AI policy. The slow uptake mirrors a broader challenge in AI for Insurance adoption: organizational readiness often lags behind available tools.
Benefits and emerging risks reshape service demands
On the benefits side, integrating AI into benefits administration and HR operations appeared as a top-10 employer challenge for the first time. It joined healthcare cost management-the perennial top concern-as employers brace for a 6.5% average increase in health benefit costs per employee in 2026, the sharpest jump since 2010, according to Mercer. Brown & Brown's own survey pegged the increase closer to 10% before plan adjustments.
The survey also uncovered a persistent disconnect between what employers value and what brokers deliver. Ninety-four percent said a multiyear strategic benefit plan is important, but only 51% reported their broker fully provides one. In commercial lines, addressing coverage for emerging risks-including AI, geopolitical instability, and climate-entered the top 10 challenges. Yet only 58% of employers said their broker fully assists with risk management strategy, even though 96% called it important.
Why this matters for insurance professionals
The twin findings-rising client expectations for AI-enabled advisory service and persistently low AI maturity among agencies-create a competitive fault line. Brokers who close the gap early can differentiate themselves as strategic partners. Those who delay risk losing accounts to firms that already offer the digital fluency and proactive planning that employers increasingly demand.
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